Blyk, a new mobile phone service for teenagers and young adults, went live in the UK yesterday. Customers aged between 16 and 24 get free mobile phone calls and texts, in exchange for receiving up to six adverts a day on their mobiles.
The mobile virtual network operator (MVNO) is carried on Orange's network, and potential …

Blyk?

Age discrimination

The flaw in the business model

The flaw in the business strictly is not in the target group but in the value proposition. Low income groups are extremely desirable for certain companies: cf. the tobacco industry; McDonald's advertising around schools in low income areas in the US and associated court case(s) but also any lottery.

The value proposition (free calls and SMS) needs to be coupled with cross and upselling opportunities for which the target group is more than happy to open its wallet. If the group thinks it is getting a bargain in one area, it is more likely to believe it is getting a bargain in all areas: the principle behind loss-leading in supermarkets.